REEDHIGH SIGNALFINANCIAL10-K

Reed's experienced severe financial deterioration with operating losses nearly doubling to -$15.1M while operating cash flow worsened by 178% to -$17.0M.

The company is burning through cash at an alarming rate with deteriorating fundamentals across all key operational metrics. Despite some debt reduction (evidenced by lower interest expense), the massive increase in operating losses and negative cash flow suggests serious operational challenges that threaten the company's viability.

Comparing 2026-03-25 vs 2025-03-28View on EDGAR →
FINANCIAL ANALYSIS

Reed's financial position deteriorated significantly with operating income declining 86.6% to -$15.1M and operating cash flow worsening 178% to -$17.0M, while gross profit fell 38.8% to $7.0M indicating both top-line and operational struggles. The company reduced some debt burden (interest expense down 79.8%) and improved stockholders' equity by 37.7% to $9.2M, but cash declined 34.2% to just $713K. The overall picture shows a company in financial distress with unsustainable cash burn, minimal liquidity, and severely deteriorating operational performance that raises going concern questions.

FINANCIAL STATEMENT CHANGES
Operating Cash Flow
Cash Flow
-178.2%
-$6.1M→-$17.0M

Operating cash flow fell 178.2% — earnings quality concerns; investigate working capital changes and non-cash items.

Operating Income
P&L
-86.6%
-$8.1M→-$15.1M

Operating income deteriorated sharply — investigate whether driven by one-time charges or structural cost issues.

Interest Expense
P&L
-79.8%
$5.5M→$1.1M

Interest expense declined — debt repayment or refinancing at lower rates improving earnings quality.

Capital Expenditure
Cash Flow
+78.9%
$152K→$272K

Capital expenditure jumped 78.9% — major investment cycle underway; assess returns on deployment.

Share Buybacks
Cash Flow
-50%
$2K→$1K

Buyback activity reduced 50% — capital being redeployed elsewhere or cash conservation underway.

Accounts Receivable
Balance Sheet
-41.8%
$4.0M→$2.3M

Receivables declined — improved collection efficiency or conservative revenue recognition.

Gross Profit
P&L
-38.8%
$11.4M→$7.0M

Gross margin compression — rising input costs, pricing pressure, or unfavorable product mix shift.

Stockholders Equity
Balance Sheet
+37.7%
$6.6M→$9.2M

Equity base grew 37.7% — retained earnings accumulation or equity issuance strengthening the balance sheet.

Cash & Equivalents
Balance Sheet
-34.2%
$1.1M→$713K

Cash declined 34.2% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.

Current Liabilities
Balance Sheet
-24.2%
$17.7M→$13.4M

Current liabilities reduced — improved short-term financial position and working capital health.

LANGUAGE CHANGES
NEW — 2026-03-25
PRIOR — 2025-03-28
ADDED
Form 10-K Summary 55 i Unless the context otherwise requires, the terms the Company, Reed s, we, us, our, and similar references in this Annual Report on Form 10-K refer to Reed s, Inc.
This Annual Report on Form 10-K contains and incorporates by reference market data and industry statistics and forecasts that are based on independent industry publications and other publicly available information.
Although we believe that these sources are reliable, we do not guarantee the accuracy or completeness of this information and we have not independently verified this information.
ii Summary Risk Factors Our business is subject to a number of risks of which you should be aware before making a decision to invest in our securities.
These risks include, among others, the following: We have incurred and may continue to incur losses, and we may be unable to achieve or maintain profitability.
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REMOVED
Business Overview Reed s, Inc., a Delaware corporation ( Reed s , the Company, we, or us throughout this report) owns a leading portfolio of handcrafted, natural beverages that is sold in over 32,000 outlets nationwide.
These outlets include the natural and specialty food channel, grocery stores, mass merchants, drug stores, convenience stores, club stores, liquor stores, and on-premises locations including bars and restaurants.
Reed s two core brands are Reed s, which includes Reed s Craft Ginger Beer, Reed s Real Ginger Ale, Reed s Classic Mules, and Reed s Hard Ginger Ale, and Virgil s Handcrafted sodas.
Reed s Craft Ginger Beers are unique due to the proprietary process of using fresh ginger root combined with a Jamaican inspired recipe of natural spices, honey and pineapple flavors, and fruit juices.
Reed s uses this same handcrafted approach in its Reed s Real Ginger Ale and Virgil s line of great tasting, bold flavored craft sodas, including its award-winning Virgil s Root Beer.
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